A certificate of deposit (CD) would be the best banking
choice when the interest rate is determined ahead of time and there is an
assurance to get back what you put in plus interest once the CD matures. If you leave the money alone during the
investment period then the bank will pay you an interest rate slightly higher
than what you would have earned in a money market or checking account. Thus,
all gains from certificate of deposits are taxable as income unless they are in
a tax-deferred (IRA) r tax-free (Roth IRA) account.
Answer:
Explanation:
The necessary adjusting entries at December 31 to record amortization required by the events above has been prepared.
It should also be noted that due to the goodwill having an indefinite life, no entry was made to amortize the goodwill.
It should be noted that the amortization expense was gotten as:
Annual amortization = $75,000/5
= $15,000
2015 amortization= $15,000 × 8/12months
= $15,000 × 2/3
= $30,000/3
= $10,000
Kindly check the attached file forthe adjusting entries
Answer:
A) Isabel's after-tax cost for paying the bill in December = $19,000 - ($19,000 x 40%) = $19,000 - $7,600 = $11,400
B) Isabel's after-tax cost for paying the bill in January:
the cost before taxes = $19,000 - ($19,000 x 4%/12) = $19,000 - $63 = $18,937
after-tax cost = $18,937 - ($18,937 x 40%) = $18,937 - $7,575 = $11,362
C) January, since the cost of the debt is lower.
